Annual Report 2010 - Hannover Re

The table below lists the catastrophe losses and major claims
that occurred in the 2010 financial year.
Licensed scientific simulation models, supplemented by the
expertise of our own specialist departments, are used to assess
our material catastrophe risks from natural hazards (especially
earthquake, windstorm and flood). Furthermore, we
establish the risk to our portfolio from various scenarios in the
form of probability distributions. The monitoring of the natural
hazards exposure of the Hannover Re portfolio (accumulation
control) is rounded out by the calculation of realistic extreme
loss scenarios. Within the scope of accumulation controlling,
the Executive Board defines the risk appetite for natural perils
once a year on the basis of the risk strategy. The risk appetite
is a key basis for our underwriting approach in this segment.
For the purposes of risk limitation, maximum underwriting
limits (capacities) are stipulated for various extreme loss scenarios
and return periods in light of profitability criteria. Adherence
to these limits is continuously verified by Group Risk
Management. The Risk Committee, the Executive Board and
the body responsible for steering non-life reinsurance are kept
regularly updated on the degree of capacity utilisation. The
limits and thresholds for the 100-year and 200-year aggregate
loss as well as the utilisation thereof are set out in the table
on the following page.
As part of our holistic approach to risk management across
business groups, we take into account numerous relevant
scenarios and extreme scenarios, determine their effect on
portfolio and performance data, evaluate them in relation to
the planned figures and identify alternative courses of action.
The price/premium risk lies primarily in the possibility of a
random claims realisation that diverges from the claims expectancy
on which the premium calculation was based. Regular
and independent reviews of the models used for treaty
quotation as well as central and local underwriting guidelines
are vital management components. In addition, Hannover Re’s
regional and treaty departments prepare regular reports on
the progress of their respective renewals. The reporting in
this regard makes reference inter alia to significant changes
in conditions, risks (such as inadequate premiums) as well as
to emerging market opportunities and the strategy pursued in
order to accomplish targets.
Management report
Catastrophe losses and major claims 1 in EUR million Date gross net
Earthquake in Chile 27 February 193.6 181.9
Earthquake in New Zealand 4 September 164.5 113.8
"Deepwater Horizon" drilling rig, Gulf of Mexico 20 April 155.2 84.7
6 aviation claims 72.1 48.2
Flooding in Eastern Europe 13 – 25 May 32.6 32.6
Earthquake in Haiti 12 January 27.2 27.2
4 marine claims 34.3 26.3
3 fire claims 23.3 23.3
Winter storm "Xynthia" in Southern and Central Europe 27/28 February 27.4 20.8
Flooding in Queensland, Australia 23 December 2010
– 10 January 2011 20.5 16.1
Windstorm in Perth, Australia 22 March 19.9 14.2
Flooding in France and Spain 12 – 16 June 17.4 11.3
Political unrest in Bangkok, Thailand 16 April – 24 May 10.3 10.3
Thunderstorms in Copenhagen, Denmark 14 – 19 August 14.4 9.4
1 liability claim 8.1 8.1
Windstorm in Melbourne, Australia 5/6 March 10.6 7.1
Flooding in Eastern Europe 6 – 8 August 7.5 7.0
Flooding in Southern Thailand 30 October –
2 November 6.7 6.7
Tornados and hail damage in the United States 16 – 18 June 5.1 5.1
Windstorm and rain in the United States 30 April – 4 May 6.5 3.9
Thunderstorm in Stuttgart, Germany 4 July 6.0 3.9
Total 863.2 661.9
1 Natural catastrophes and other major claims > EUR 5 million gross
Hannover Re Group annual report 2010
opportunity and risk report Management report
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